Scams and shams — April 2014

News on the scammers who didn't get away with it, including Pearl Jam's former CFO, a renowned vintage wine dealer and the Russian hacker behind the computer virus SpyEye.

Grunge Sponge

Uneven flow of cash exposes Pearl Jam accountant's con

Pearl Jam

Pearl Jam, The Seattle Rock band that waged a highly public battle against Ticketmaster in the '90s for gouging fans on concert tickets, has itself been fleeced. The former CFO for the band, Rickey Charles Goodrich, 55, was sentenced to 14 months in prison after pleading guilty to bilking Pearl Jam out of US$380,000 from 2007 to 2010. Goodrich used the group's money to pay off personal debts, credit card bills and take his family on vacations and to spas. His activities were discovered when the band's manager had concerns over cash flow issues. Goodrich agreed to pay back all the money and, so far, has made good on US$125,000.

Vintage Scam

Wine dealer duped buyers with plonk

a man drinking wine

A renowned US wine collector and dealer is facing up to 40 years in jail for counterfeiting vintage wines and selling them to oenophiles around the world for millions of dollars. Using a blend of cheaper wines that he mixed in his kitchen, Rudy Kurniawan, 37, deceived buyers for years with more than 1,000 bottles he falsely labelled as fine Burgundy and Bordeaux wines. In 2006 alone, two New York auctions that featured his wines brought in US$35 million. Indonesian-born Kurniawan, who will be sentenced later this month, was arrested and detained in 2012. Sour Grapes, a European-produced documentary film about the convicted fraudster, is currently in the works.

Code Red

Russian implicated as SpyEye mastermind

Aleksandr Andreevich Panin, a Russian hacker known as Gribodemon and Harderman, pleaded guilty to conspiracy to commit wire and bank fraud for his role as the main developer and distributor of SpyEye, a malicious computer virus. The virus facilitated the theft of personal and financial information — online banking credentials, credit card information and PINs — by infecting 1.4 million computers since 2009. Panin, who advertised SpyEye in online, invite-only criminal forums, is thought to have sold it to 150 "clients" for US$1,000 to US$8,000. One client used it to steal more than US$3.2 million in a six-month period. Authorities nabbed 24-year-old Panin last June while he was on vacation in the Dominican Republic; he will be sentenced at the end of April. "Cybercriminals be forewarned — you cannot hide in the shadows of the Internet," said US Attorney Sally Quillian Yates.

Cheaters Never Prosper

Hell hath ...

Andrew Rooke, an insurance and risk manager for a London town council office, pleaded guilty to defrauding the municipality out of £46,000 ($85,060). The crime came to light when his wife discovered he was having an affair and blew the whistle on him. As reported in The Daily Mail, "The defendant's wife telephoned the council and said he was having an affair and asked them to check why she and her husband had enjoyed a free holiday." Rooke was sentenced to 16 months in prison, suspended for two years and ordered to perform 200 hours of community service.

About the Author

Tamar Satov


Tamar Satov is managing editor of CPA Magazine.

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